As Ometria’s email marketing consultant, I work with a wide range of ecommerce businesses—from multi-country retailers to independent boutiques, fashion labels to furniture giants.

What do they all have in common? The desire to give customers marketing experiences they’ll love.

In an age of ‘digital bombardment’, understanding who your customer is, the marketing channels they use, the content they want to receive and the best time to deliver this content is essential to achieving this universal goal.

No matter what you sell, personalised marketing is a must in today’s ecommerce reality—with the amount of contact information available, relevance is now key to achieving the highest engagement and ROI for every marketing activity you put in place.

Below, I’ve taken a look at how today’s marketers are harnessing both well-known techniques such as segmentation and more advanced practices like dynamic content to provide customers with the best experience possible.

(N.b. To remind yourself of the difference between segmentation and dynamic content, check out this blog post.)

What is customer lifetime value?

We all stumble through life clutching onto the fuzzy memories of those pesky Pythagoras and algebraic theorems that haunted many a youth, and—with rare use cases in present day life—they normally end up getting filed and forgotten.

Enter customer lifetime value: the only equation you need to remember.

In ecommerce, CLV is the value a customer contributes to your business over their entire lifetime at your company.

The main methods of calculating CLV are split between historic and predictive CLV:

Historic CLV (Good indication of CLV)

Simply the sum of the gross profit from all historic purchases for an individual customer.

Predictive CLV (Great indication of CLV)

A predictive analysis of previous transaction history and various behavioural indicators which forecasts the lifetime value of an individual. As long as the equation is accurate, this value will become more accurate with every purchase and interaction.

If you’ve avoided cohort analysis until now, we understand why. We know the state of confusion, anxiety and frustration it can initially bring about.

But trust us: once you *have* got it, it’s totally worth it—enabling you to explore the performance of your marketing in greater depth than ever before. In this blog post, we’ll cover the following areas:

Two of the most common questions I get asked by online retailers I work with are:

“What customer metrics should I be tracking?”

“Which ones should I be looking to influence?”

Typically most ecommerce managers and digital marketing managers will be tracking top line metrics like revenue per marketing channel and conversion rate, but it is surprising that the ones who are tracking metrics such as repeat rate, new customer revenue and time to second purchase are still in a minority.

These are all crucial metrics to be looking at, and if you can optimise them the long term health of your business can be greatly enhanced.

The customer acquisition cost (CAC or CoCA) means the price you pay to acquire a new customer. In its simplest form, it can be worked out by:

Dividing the total costs associated with acquisition by total new customers, within a specific time period

Do not get this metric confused with cost per action (CPA), as there is a strong distinction between the two. In ecommerce, cost per action is typically the amount you pay to convert a customer (i.e. to make a sale), but this relates to both new and returning customers.